Kandi Technologies' Zhejiang Kandi Vehicles Co. division, which reached what's regarded as the largest-ever electric-vehicle distribution agreement in China with the city of Hangzhou in July, has settled on a price and delivery date for the first 5,000 of those urban electric vehicles.
The Kandi division reached a "definitive sales contract" to sell the 5,000 EVs to the city for about $31.6 million – which comes to around $6,317 a pop. There's a catch, though, and that's that the vehicles don't include batteries. Those will be provided by China Aviation Lithium Battery Co., and the electricity will be supplied for free by local utilities.
The July agreement called for 20,000 EVs to be eventually purchased by Hangzhou, the capital of Zhejiang Province, as part of a vehicle-to-grid technology-testing program. No word on when the remaining 15,000 EVs will be purchased.
Deliveries of the EVs, which have a top speed of about 25 miles per hour and weigh about 1,600 pounds, started last week and will continue through the end of the year. Check out Kandi's press release below.
JINHUA, CHINA--(Marketwire - Oct 1, 2012) - Kandi Technologies, Corp. (the 'Company' or 'Kandi') (NASDAQ: KNDI), a leading Chinese manufacturer and developer of pure electric vehicles (EVs) and all-terrain vehicles (ATVs), today announced that the Company's wholly owned subsidiary, Zhejiang Kandi Vehicles Co., Ltd. ('Kandi Vehicles') has signed the sales contract with China Aviation Lithium Battery (Hangzhou) Co., Ltd. ('CALB Hangzhou') to provide the first 5,000 EVs for the currently largest pure EV commercialization launch in China -- the 20,000 pure EV leasing program in Hangzhou.
According to the letter of intent between Kandi Vehicles and China Aviation Lithium Battery Co., Ltd ('CALB') of July 16th, 2012 for the purpose of promoting the 20,000 pure EV leasing program in Hangzhou, CALB established a wholly owned subsidiary, China Aviation Lithium Battery (Hangzhou) Co., Ltd. in Hangzhou city to specifically facilitate the implementation of the leasing program. CALB Hangzhou will be responsible for the operation of the Hangzhou project. In furtherance of the letter of intent, on September 29th, 2012, Kandi Vehicles and CALB Hangzhou entered into a definitive sales contract and the principal provisions of the contract are as follows:
- CALB Hangzhou will purchase 5,000 JNJ6290EV model pure electric vehicles (without batteries) from Kandi Vehicles and the total purchase price will be RMB 199,000,000 (approximately US$31.58 million). The unit price without the battery is at RMB39,800 (approximately US$6,317).
- Under the sales contract, the temporarily scheduled deliveries of the 5,000 vehicles will occur from September 29th to December 31st, 2012.
- Kandi Vehicles will deliver the vehicles upon receipt of a written confirmation notice and full payment of CALB Hangzhou. The orders will be delivered in several installments. Kandi Vehicles is obligated to deliver the ordered EVs to the designated places in Hangzhou City within 7 business days upon receiving the confirmatory notice and the payment.
- Kandi Vehicles will ensure that the electric vehicles meet the strict quality standards and technical parameters of Chinese Government and CALB. For instance, Kandi Vehicles' EV must be on the list of "Approved Passenger Vehicles" and "Recommended Models for Energy Saving/New Energy Vehicle Demonstration and Promotion in China" of Ministry of Industry and Information Technology.
- Kandi Vehicles will ensure that the electric vehicles in the contract meet all the technical requirements for the existing and future battery charging/exchanging infrastructures, such as the Quick Battery Exchange ('QBE') stations that are in construction by State Grid Corporation of China ('SGCC').
- Kandi Vehicles will provide necessary post-sale customer service, training and maintenance for the Hangzhou EV leasing program.
"I would also like to personally give my appreciation to Kandi's shareholders for their unwavering support, understanding and valuable suggestions. I was able to meet and interact with some of our shareholders in the recent Kandi Investor Day in Atlanta, GA. Although there have been quite a few negative reports about China concept companies in the past two years, as a result, many Chinese companies have chosen to go private and leave the U.S. capital market, Kandi has been working even harder to maximize our shareholders' value and moving inexorably towards our objective of becoming a leading pure EV manufacturer & solution provider, and we will continue to improve our communication with the shareholders," Mr. Hu added.
"One thing is certain that we are still at an early stage of clean energy technology reformation in China for the next couple of decades. Given the government's policy, support and financial incentives to this young EV industry, China will certainly become the largest market for EV sales. From that perspective, Kandi is very fortunate to be a pure EV company in China. We have full confidence that our innovative EV business model and the practical EV solution plan work very well with China's current national conditions and needs of our business partners, and most importantly, with the regular customers in China," Mr. Hu concluded.
About Kandi Technologies, Corp.
Kandi Technologies, Corp. (NASDAQ: KNDI) is a manufacturer and exporter of a variety of vehicles in China, making it a world leader in the production of popular off-road vehicles (ORVs). It also ranks among the leading manufacturers in China of all-terrain vehicles (ATVs), specialized utility vehicles (UTVs), and a recently introduced second-generation high mileage, two-seat three-wheeled motorcycle. Another major company focus has been on the manufacture and sale of the COCO electric vehicle (EV), a highly economical, beautifully designed, all-electric super mini-car for neighborhood driving and commuting. The convertible and hardtop models of the COCO EV are available in the United States and other countries, while the Chinese government has approved the sale of Kandi EVs in China since 2010. More information can be viewed at its corporate website is http://www.kandivehicle.com/.
Safe Harbor Statement
This press release contains certain statements that may include "forward-looking statements." All statements other than statements of historical fact included herein are "forward-looking statements." These forward-looking statements are often identified by the use of forward-looking terminology such as "believes," "expects" or similar expressions, involving known and unknown risks and uncertainties. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, they do involve assumptions, risks and uncertainties, and these expectations may prove to be incorrect. You should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. The Company's actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including the risk factors discussed in the Company's periodic reports that are filed with the Securities and Exchange Commission and available on the SEC's website (http://www.sec.gov). All forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these risk factors. Other than as required under the securities laws, the Company does not assume a duty to update these forward-looking statements.